Opening Play for Tuesday 7/8

Lots to look at currently: The SPs have a rising wedge that shows up nicely on both the daily charts as well as the 60,000. This chart can continue to develop for another day or two and does not guarantee an imminent break on Tuesday. It is a very nice cycle though!

Tick chart. The chart of the DOW next to it shows the upside breakout that needs to hold 16880 or, a close back below this can lead to the middle of the prior trading range and possibly a test of the lower end. The DOW received attention for hitting 17,000 going into the Fourth of July and Big Round Numbers tend to bring in profit taking. It may well still hold its upside breakout but this is a good chart to watch.

Though the chart of Corn is not by any means suggesting a Long position, It does have a classic Buy Divergences or “Five Fingers” on the 2-period ROC so this is an illustrative example to watch. The British Bound has been on an extended run to the upside and had its first close below the 5 SMA, along with a Pinball Buy. It also has a three bar breakout pattern so respect the 7 AM reading if looking to the long side.

At the Bottom of this commentary, you will see charts of all the three bar breakouts that Mick thoughtfully posted.

Also of interest: I have been mentioning Larry McMillan’s work regarding a seasonal low in the Implied Volatility for quite a few weeks. I took the liberty of asking him if his seasonal charts still hold and he sent me a chart for your review. Seasonal patterns are merely guidelines…but I have always been impressed by Larry’s research.

The DOW, SPs and Russell tested into a prior pit session gap area. The Nazdaq continues to trade well above it. AAPL still carries one of the highest weightings in the Nazdaq….it is less than 5 points away from all time highs.